CNN PEOPLE IN THE NEWS

PEOPLE IN THE NEWS

Aired September 14, 2002 - 11:00 ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

(BEGIN VIDEO CLIP) ANNOUNCER: Next on PEOPLE IN THE NEWS, two Big Apple mayors who helped with healing and rebuilding after the attacks on America. First, as his city fell down around him, the mayor of New York stood tall.

FORMER MAYOR RUDY GIULIANI, NEW YORK: American democracy is much stronger than these vicious, cowardly terrorists.

ANNOUNCER: A hard-nose prosecutor, he originally aimed to clean up the Gotham streets, gaining both support and criticism.

ANNOUNCER: How a Catholic boy from the Bronx became America's mayor, Rudy Giuliani. Then, he took over three months after its biggest disaster ever. From humble beginnings, he became a multimedia billionaire with hard work and high standards.

UNIDENTIFIED MALE: Those people that come in earlier and stay later are more focused. Those are the people that do the best.

UNIDENTIFIED MALE: This is Mike Bloomberg. He's running for mayor of New York City.

ANNOUNCER: He was a major underdog in the race for mayor until he got the recommendation of a lifetime.

UNIDENTIFIED MALE: His endorsement decided the race.

ANNOUNCER: From private sector to public life, Mayor Michael Bloomberg. Their stories now on PEOPLE IN THE NEWS.

(END VIDEO CLIP)

KYRA PHILLIPS, GUEST HOST: Welcome to PEOPLE IN THE NEWS. For Paula Zahn, I'm Kyra Phillips.

In the chaotic moments of September 11, last year, in the days and weeks that followed, Rudolph Giuliani became a modern day hero. It was a remarkable and almost instantaneous transformation. That's because until the events of 9/11, Giuliani seemed as if he might just vanish into history. His two terms as the mayor of New York were nearly up and he was leaving to very mixed reviews.

GIULIANI: The situation is that two airplanes have attacked, apparently...

COLLINS, (voice-over): The New York City mayor found himself at Ground Zero for literally and figuratively on the day of the attacks on the World Trade Center. He called for calm and tolerance.

GIULIANI: We have a lot of people in this city of all different backgrounds and all diverse religions, and they're not responsible for this.

COLLINS: He won praise from hard-bitten New Yorkers.

UNIDENTIFIED MALE: I've never had no love for him, but listen, the man deserves to be mayor.

UNIDENTIFIED MALE: Mayor Rudy Giuliani, who has been such a rock...

COLLINS: This lifelong Yankee fan even got a standing ovation at a Mets game. He humbly accepted an honorary knighthood from England's Prince Andrew.

GIULIANI: I'm worried about the teasing that I'm going to take as a result of it. Thank you very much.

COLLINS: In the end, he was named "TIME" magazine's "Person of The Year." Just a year earlier, Rudy Giuliani's life seemed to be in personal and political ruin.

GIULIANI: I think I'm not going to make comments today. I just wanted to go to out to lunch and -- thank you.

COLLINS: He had been diagnosed with cancer, suffered a publicly messy split with his second wife, and had dropped out of the race for United States Senate.

GIULIANI: This is not the right time for me to run for office.

COLLINS: After September 11, that all seemed forgotten. Rudy Giuliani became the king of New York.

Rudolph William Giuliani was born in Brooklyn, New York, on May 28, 1944, the only child to Helen and Harold Giuliani, first- generation Italian Americans who owned a bar and grill.

POWERS: It was a very strong family, a very loving family, not only his parents, but his aunts and uncles. He had an uncle who was a fireman, an uncle who was a police officer. I mean, he would often say to people, now people are talking about it, "You don't understand about firemen. Everyone's running one way, they go into another, they defy nature, they walk into a fire."

COLLINS: Peter Powers and Rudy Giuliani made their way through Catholic school together. They met at Bishop Loughlin High School in Clinton Hill, Brooklyn.

POWERS: He was very popular. People liked him. There was always that leadership ability there.

COLLINS: So much so that Rudy was voted class politician without even holding a student government office in high school. Brought up as a liberal Democrat, he was also the head of the JFK for President Committee. Rudy went on to Manhattan College, a Catholic school in the Bronx. After seriously considering the priesthood, he made the decision to pursue law.

POWERS: He says when he hit puberty that he decided he wanted to do some good and do it in a different way.

COLLINS: After Manhattan College, Giuliani attended New York University's law school, where he graduated magna cum laude in 1968. Shortly after graduation, he married his college sweetheart, Regina Perugi (ph), but 14 years later, he would get the marriage annulled.

Giuliani became an assistant United States attorney in the gritty Southern District of New York in 1970, and made a name for himself as a brilliant cross-examiner. His reputation eventually brought him to Washington, D.C., and the Department of Justice. During Gerald Ford's administration, he switched his allegiances to the Republican Party. Critics claim the move was politically motivated, but his long-time friend disagrees.

POWERS: When he finally realized that his core beliefs were better personified by the Republican Party, he believes that that's the party that tries to stress that people should be able to help themselves rather than government just taking over their lives.

COLLINS: In 1981, under Ronald Reagan, Giuliani was given the number three position in the Justice Department. There, he handled narcotics law enforcement.

GIULIANI: There's going to be quite a battle.

COLLINS: Giuliani returned home in 1983 to head the U.S. attorney's office, where he prosecuted some of the most high-profile cases in New York City's history, among them Milken, Marcos and the Mafia.

GIULIANI: We can solve crimes that sometimes cannot be solved by others. ANDREW KIRTZMAN, AUTHOR, "RUDY GIULIANI: EMPEROR OF THE CITY": When he was a U.S. attorney, he vanquished the bad guys on Wall Street and in the Mafia and became a heroic figure.

UNIDENTIFIED MALE: The man who's going to be our next mayor, who's going to give the city of New York back its soul, Rudy Giuliani.

COLLINS: The mayor's race was a natural step in 1989.

GIULIANI: Now is the time to take our city back from the violent criminals on the streets and the white-collar criminals in their office suites.

COLLINS: Hard-nosed prosecutor Giuliani was a popular candidate in a city where the crime rate was skyrocketing. On Election Day, David Dinkins became the city's first black mayor, defeating Rudolph Giuliani by less than three percentage points.

GIULIANI: I've congratulated him, and I've wished him and his family the very best for the future of New York and for their future and they deserve your applause. Applaud for them.

COLLINS: Rudy Giuliani went into private practice, but he wasn't going away.

(BEGIN VIDEOTAPE)

COLLINS: When our story continues, a righteous Rudy vows to clean up a city, but his hard-line stance raises some concerns.

ANNOUNCER: Also, ahead on PEOPLE IN THE NEWS, the New York mayor who had quite a tough act to follow.

(BEGIN VIDEO CLIP)

MAYOR MICHAEL BLOOMBERG, NEW YORK CITY: He said to me, don't fail our people. Rudy, I will not.

(END VIDEO CLIP)

ANNOUNCER: A look at Michael Bloomberg, that's later on PEOPLE IN THE NEWS.

(COMMERCIAL BREAK)

ANNOUNCER: Welcome back to PEOPLE IN THE NEWS.

(BEGIN VIDEOTAPE)

COLLINS (voice-over): Little shine remained on the Big Apple by the early '90s. On the cover of "TIME" magazine, New York City was dubbed "The Rotting Apple." Rudolph Giuliani, a well-known federal prosecutor, was running for mayor once again against incumbent David Dinkins. KIRTZMAN: The city was in desperate shape. The crime situation was really, really out of control, and kind of the daily experience of the average New Yorker heading to work was extremely unpleasant. The homeless situation had kind of exploded into something worse and something more menacing.

COLLINS: The environment seemed ripe for a candidate with a reputation as a tough-as-nails federal prosecutor, though his crime- fighting persona frightened a few.

KIRTZMAN: People worried that he was kind of a dangerous figure, because he was so good, and he had a way of kind of capitalizing on his power so well, they wondered about his judgment.

GIULIANI: We have to listen to them when they tell us they want a higher quality of life, a cleaner city, a better city.

COLLINS: Giuliani promised to upgrade the quality of life in New York City by getting rid of everyday nuisances like the squeegee men.

On Election Day, Giuliani squeaked by Dinkins with only 44,000 votes to spare, a mere two percent.

COLLINS: In January 1994, with his second wife, Donna Hanover, and their two children at his side, he became New York's 107 mayor, and the first Republican to hold the office in 20 years.

GIULIANI: I'm going to have a co-addressee, I guess, Andrew.

COLLINS: His son, Andrew, mugged for the cameras throughout Giuliani's inaugural address.

KIRTZMAN: I think most of the city found it pretty endearing that this hard-nosed prosecutor was willing to let his kid have the run of the place at his kind of big moment in the limelight.

COLLINS: Right away, Giuliani set about to do what he had promised, clean up the city.

UNIDENTIFIED MALE: (UNINTELLIGIBLE) beer in the bag?

UNIDENTIFIED MALE: Do me a favor, dump the beer, please?

COLLINS: But his methods were drawing criticism.

UNIDENTIFIED MALE: It's like a police state, in a way, sometimes, the way they just stop people.

REV. AL SHARPTON, NATIONAL ACTION NETWORK: I cannot judge what happened, but I can judge the knee-jerk reaction that Giuliani has already again displayed.

KIRTZMAN: To combat that sense of lawlessness on the street, Giuliani used his police force as an army. There was sort of an ends- justify-the-means mentality, that, you know, this was a wartime situation, New York was faced with lawlessness at every turn, and something dramatic had to be done.

POWERS: It was a small thing when we started arresting fare- jumpers, OK, because we found that many fare-jumpers were either out on parole or in violation of parole. Many times, they had weapons on them. So when you do the little things, the bigger things sort of take care of themselves a lot.

GIULIANI: And I believe that you create a better society by setting higher standards and expecting better behavior from people.

COLLINS: However unpopular, Giuliani's tactics worked. During his first two years as mayor, crime dropped by 30 percent. Murders and robberies were at their lowest point in 25 years, and the city's welfare rolls were trimmed by more than 100,000.

POWERS: People believed in their hearts that New York City was ungovernable. People would say it as if it were the gospel truth. The fact of the matter is, he's shown them with the right leadership, putting the right team together, you can govern this city.

KIRTZMAN: At some point, Giuliani became almost the victim of his own success, and crime had been cut in half, the city was cleaner, people felt so much better about the city. Tourists were just flooding the streets of New York. And he was without an enemy to fight.

COLLINS: But ex-prosecutor Giuliani managed to find some enemies. To many, his mounting quality of life campaigns against hot dog vendors, jaywalkers, publicly funded art and cab drivers seemed like the work of a bully.

POWERS: He doesn't know halfway, Rudy Giuliani.

COLLINS: Halfway was something he definitely didn't know when it came to defending his police force. Two years into his second term, an African immigrant named Amadou Diallo was shot 19 times in his Bronx doorway by four young cops in the NYPD's Street Crimes Unit. They said they thought he was reaching for a gun. It turned out to be a wallet, and Giuliani was faced with the biggest crisis of his administration. The details were slow to emerge, but Giuliani was quick to defend his policemen.

GIULIANI: All four of them had backgrounds as very active police officers, and from what we can tell, have very good records and were considered to be excellent police officers.

EDWARD I. KOCH, FORMER NEW YORK CITY MAYOR: I wouldn't defend those cops on the facts that were given at that time.

COLLINS: An Albany jury ruled the officers acted within the law, but the feelings about the incident and Giuliani's reaction lingered.

GIULIANI: I understand both sides of the issue. I have my own very strongly held views about it, so I don't see how a rally is going to change that.

KIRTZMAN: That just outraged the people who felt that he needed to show sensitivity toward minority neighborhoods when it involved someone who had been shot by a white cop. And it caused him a lot of grief.

COLLINS: Despite his controversial actions, Giuliani emerged in 1999 as the Republican Party favorite in the run for the United States Senate against then-First Lady Hillary Clinton. Polls showed Giuliani within striking distance of Clinton in April of 2000 when he got bad news about his health.

GIULIANI: Obviously, the bad news is that there's cancer.

COLLINS: Giuliani had been diagnosed with a treatable form of prostate cancer, a disease, which had killed his father. The mayor's political future was now uncertain.

QUESTION: But could you at least tell us what you think or how, if at all, this affects the Senate race?

GIULIANI: I have no idea.

COLLINS: Giuliani continued to campaign while he considered treatment options. Less than a week later, there was more bad news for Giuliani.

GIULIANI: She's a good friend, a very good friend. And beyond that, you can ask me questions, and that's exactly what I'm going to say.

COLLINS: "The New York Post" decided to expose his relationship with Judith Nathan. What followed in the next days was a bizarre series of press conferences in which the mayor and his wife, Donna Hanover, seemed to be breaking up in public.

DONNA HANOVER, GIULIANI'S WIFE: Today's turn of events brings me great sadness. I had hoped to keep this marriage together.

GIULIANI: In many ways, we've grown to live independent and separate lives.

COLLINS: Through it all, for more than two weeks, Giuliani refused to speculate on his political future.

UNIDENTIFIED MALE: ... go beat Hillary!

QUESTION: Mr. Mayor, do you know when can expect a decision?

GIULIANI: No.

QUESTION: Mr. Mayor, can you tell us...

GIULIANI: I'm not going to comment. I'm not going to comment on it. So, you know, you can ask me in five different ways, I'm not going to comment. COLLINS: Giuliani did comment the next day. He said his cancer treatment would prevent him from continuing his run for Senate.

GIULIANI: I thank God that it gives me another -- really another 18 months to be the mayor of New York City, which I love very, very much. It's really my deep passion, the love for the people of this city and the love of this city. I also believe that, you know, things happen in life for reasons that sometimes you only figure out afterward.

COLLINS: Rudolph Giuliani and New York City may have figured out those reasons on September 11, 2001.

(END VIDEOTAPE)

When PEOPLE IN THE NEWS continues, Rudy takes control in a city under siege.

(COMMERCIAL BREAK)

ANNOUNCER: We now return to PEOPLE IN THE NEWS.

(BEGIN VIDEOTAPE)

GIULIANI: I love the people of the city of New York. Some of them love me and some of them hate me, but I think they all have a reaction to me.

KIRTZMAN: Much of the public was exhausted by Giuliani.

COLLINS (voice-over): New York State's term limits dictated that he was scheduled to step down January 1, 2002.

KOCH: Most people had come to the conclusion that as he left office, that it was a pity. He had shown certainly leadership, but the insensitivity had destroyed his legacy.

COLLINS: Then the events of September 11 unfolded.

KIRTZMAN: I think he's now an American hero.

COLLINS: The mayor was at Ground Zero of the World Trade Center disaster. He arrived as the second plane hit. He himself was trapped for a time by the explosion of smoke and ash from the collapse of the first tower, yet he managed to keep his composure.

KIRTZMAN: You know I was with Giuliani when tower two collapsed. We all started running for our lives. The most incredible thing, as we progressed up Sixth Avenue was there were waves of people on both sides of us, sobbing and obviously just scared out of their minds, was that Giuliani was the calmest one in the bunch.

COLLINS: By the time his first press conference came, just four hours after the second tower fell; Giuliani was the lone voice for a nation.

GIULIANI: The number of casualties will be more than any of us can bear, ultimately.

COLLINS: He delivered the bad news with the perfect mixture of compassion, anger, and reassurance.

GIULIANI: American democracy is much stronger than a vicious, cowardly terrorist, and we're going to overcome this.

COLLINS: Giuliani was, in a word, presidential.

KIRTZMAN: You have to remember that the day of the crisis, George W. Bush was in flight. It was really Rudy Giuliani who was on the air most of the day being very decisive and being very reassuring, telling people that we had weathered this extraordinary, extraordinary catastrophe, but that New York was going to be here today, it was going to be here tomorrow, and that we would survive.

UNIDENTIFIED MALE: When he got up there the first time and I heard him, I kind of felt like everything was going to be OK.

COLLINS: The workaholic mayor even encouraged people to stay home.

GIULIANI: If tomorrow is a day in which you want to stay home and stay with your family and give comfort and support maybe to other people that have been affected by this, it would be a good day to do that.

KIRTZMAN: And I think that in this crisis, people wanted a father figure. They wanted someone who could tell them that it's OK to cry, it's OK to be scared.

COLLINS: The nephew of a firefighter, he performed the difficult task of attending every funeral and promoting fire officials to fill the positions of those lost.

GIULIANI: So you're all my heroes. You have been from the time I was a little boy and from the day that I became the mayor of New York City.

COLLINS: He grieved while he took control. It seemed like Rudy could do no wrong. Even his harshest critics had to acknowledge he was handling the crisis beautifully.

KOCH: Since the catastrophe, he's exhibited the leadership which he's always had, but what was different was that he was sensitive and warm and compassionate and showed nuances with respect to emotion that he had never shown before.

COLLINS: But some took his emotional epiphany with a grain of salt.

SHARPTON: Maybe if he wasn't perceived to be so insensitive, no one would be paying so much attention to him finally showing sensitivity.

POWERS: And whether people have noticed his compassionate side, because it's always been there, and the tough side had gotten us a better city.

COLLINS: But about two weeks after the attack, a little bloom came off the rose. Politics began to creep in. The mayor, scheduled to leave office in January, was considering ways to stay on.

GIULIANI: What I can tell you is that what I'd like to do is to maintain the unity that exists in the city. And I've met -- I'm going to meet with the candidates and talk to them about something that we can agree on.

SHARPTON: He's his own worst enemy. In the height of this, he allows underlings to come with a political agenda -- let's change the law, let's extend his term -- and in many ways began to exploit the feeling of unity for his own political ends.

KIRTZMAN: I think people are seeing what they used to see in Giuliani come back again, which is this ruthlessness to get what he wants.

COLLINS: A couple of weeks later, the Democratic City Council effectively put an end to Giuliani's quest for an extension and billionaire, Michael Bloomberg became mayor on January 1, 2002.

BLOOMBERG: And thank you so much. I will not let you down.

COLLINS: No longer in public office, Giuliani is putting his energies and experience into a private business venture, Giuliani Partners.

GIULIANI: The area in which, you know, we're doing a lot of preliminary work, at least, is to secure the area, trying to give businesses an understanding of what they need to do now, to be secure given the threats that we're now aware, that we weren't aware of before.

COLLINS: And this July, after some time out of the spotlight, Giuliani was back on tabloid covers with news of his messy divorce settlement.

GIULIANI: I'm relieved that we're able to reach an agreement.

COLLINS: But if the enduring memory is that of Rudy Giuliani on that faithful day last September, there's still chance that he could once again run the city that he likes the call "The Center of The Universe."

KOCH: I'm sure that he will run for another office. I'm sure he'll run for mayor again.

KIRTZMAN: Giuliani is a born chief executive, and I think if he ever wanted to move out of City Hall, it would be to the governor's mansion or to the White House.

(END VIDEOTAPE)

PHILLIPS: Rudy Giuliani says he's busy dividing his time these days between working at his private business, writing a book and giving speeches. As for a return to professional politics, Giuliani says he'll be back.

ANNOUNCER: Coming up on PEOPLE IN THE NEWS, the long shot mayor with big time expectations from his city and himself.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: I think Mike thinks that he's going to be the best mayor that New York ever had.

(END VIDEO CLIP)

ANNOUNCER: The story of Michael Bloomberg when PEOPLE IN THE NEWS returns.

PHILLIPS: Pick up a special edition of "People" magazine this week, featuring this year's best and worst dressed.

(INTERRUPTED BY BREAKING NEWS)

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